In 2021, Zte Corporation(000063) ( Zte Corporation(000063) ) handed over a beautiful report card, and the core financial indicators such as operating income, net profit and operating cash flow reached the best level in history.
three major businesses “flying together”
On March 8, Zte Corporation(000063) released its 2021 annual report, which showed that in 2021, Zte Corporation(000063) achieved operating revenue of 114.52 billion yuan, a year-on-year increase of 12.9%, net profit of 6.81 billion yuan, a year-on-year increase of 59.9%, deduction of non net profit of 3.31 billion yuan, a year-on-year increase of 219.2%, basic earnings per share of 1.47 yuan, net cash flow from operating activities of 15.72 billion yuan, a year-on-year increase of 53.7%.
Zte Corporation(000063) said that 2021 is the end of the company’s strategic development period. In the face of covid-19 epidemic and complex external environment, while consolidating its core competitiveness, the company has deepened digital transformation and continued to expand its capability and transaction boundaries. While maintaining good growth of various businesses, the company has significantly improved its operation quality, operating revenue, net profit Core financial indicators such as net operating cash flow hit a record high.
From the perspective of market, the operating revenue of Zte Corporation(000063) China and international markets will increase year-on-year in 2021. Among them, the Chinese market achieved an operating revenue of 78.07 billion yuan, a year-on-year increase of 14.7%, accounting for 68.2% of the overall operating revenue; The international market realized an operating revenue of 36.45 billion yuan, a year-on-year increase of 9.1%, accounting for 31.8% of the overall operating revenue.
By business, in 2021, the operating revenue of Zte Corporation(000063) operators’ networks, government enterprises and consumers achieved year-on-year growth.
Among them, the operator business, as the cornerstone business of Zte Corporation(000063) core, has accounted for more than half of the revenue for a long time. The annual report shows that in 2021, Zte Corporation(000063) deeply participated in the large-scale construction of 5g and digitization in China, the overall market share continued to increase, accounting for more than 1 / 3, and the annual operating revenue was 75.71 billion yuan, an increase of 2.3% year-on-year. According to the plan of Zte Corporation(000063) and by optimizing the market pattern, we hope to accelerate the consolidation of its position as a strategic supplier and ensure the stable growth of the business.
In terms of government and enterprise business, Zte Corporation(000063) grasped the market opportunities such as new infrastructure, industry digital transformation and dual carbon economy, and realized the overall rapid growth in energy, transportation, government affairs, finance, Internet, large enterprises and other markets. The annual operating revenue reached 13.08 billion yuan, a year-on-year increase of 16%, and the operating revenue of China’s government and enterprise business increased by more than 40%. Among them, the operating revenue of servers and storage doubled year-on-year. Data center, goldendb distributed database and other products have entered the leading enterprises in related industries.
In terms of consumer business, Zte Corporation(000063) consolidated the “big terminal” product strategy, realized the transformation from a single intelligent product to a full scene intelligent life, promoted the sales of personal and family products, achieved rapid growth, and achieved an annual operating revenue of 25.73 billion yuan, a year-on-year increase of 59.2%. Among them, the operating income of household terminals increased by more than 80% year-on-year, and the operating income of mobile phone products increased by nearly 40% year-on-year.
strengthen the second curve of R & D investment
Zte Corporation(000063) also continued to strengthen R & D investment and enhance product competitiveness. The annual report shows that Zte Corporation(000063) R & D investment in 2021 was 18.8 billion yuan, accounting for 16.4% of operating revenue, with a year-on-year increase of 1.8 percentage points, focusing on 5g wireless, core network, bearer, access, chip, server and storage, automotive electronics, industrial digitization, digital energy, terminal and other technical fields. In recent three years, the proportion of Zte Corporation(000063) R & D personnel has increased from 40.4% to 46.0%, and the R & D investment has increased from 13.8% to 16.4% in recent three years.
At present, in 5g, optical network and other core fields, the company’s product competitiveness has been in a leading position in the world. In 2021, the shipment volume of Zte Corporation(000063) 5g base station ranked second in the world (delloro group). Optical network revenue ranks second in the global operator market share (omdia), and optical access and optical transmission related products maintain the leader ranking (GlobalData).
Looking forward to 2022, Zte Corporation(000063) said that in 2022, the company will continue to consolidate its core competitiveness, optimize the market pattern, continue to invest in core technologies such as chips, algorithms and network architecture, maintain technology leadership in key fields and increase its value market share, strive for progress while maintaining stability, and consolidate the first curve; In addition, Zte Corporation(000063) will continue to deepen its digital transformation, accelerate capacity precipitation and scheme iteration, and expand the breadth and depth of cooperation with industrial and ecological partners.
The second curve is the focus of the industry. In 2021, at ZTE global analyst conference, Zte Corporation(000063) with its own positioning of “road builder of digital economy”, mentioned the business development logic of “second curve” for the first time.
In the field of it, Zte Corporation(000063) focuses on building the bottom competitiveness of IT products such as server and storage, operating system and database, becoming a 10 billion product; Two special teams of mining, metallurgy and iron and steel industries were established for specific subdivided industries to Zte Corporation(000063) realize the in-depth expansion of 5g industry application market Zte Corporation(000063) has also established an automotive electronic product line, which is positioned as a provider of basic capabilities of digital vehicles and helps the development of intelligence and networking in the automotive field. At the end of last year, Zte Corporation(000063) has begun to strengthen the company’s communication in it business, and the advertisements of the company’s servers and storage products have officially appeared at major airports and high-speed railway stations.
In addition, at the beginning of this year, Zte Corporation(000063) newly established the digital energy business department, officially entering the new energy industry. At the same time, in the field of terminals, Zte Corporation(000063) also set up a smart home product line this year, aiming to give full play to the advantages of existing home information terminal products and vigorously expand consumer oriented home intelligent products.
On the whole, Zte Corporation(000063) the new growth engine in the future also comes from the new opportunities brought by the trend of industrial digitization and digital industrialization driven by the digital economy.
